Oil looks heavy while the stock market is in a Fed induced stupor. A rumor overnight of a blast in the Suez Canal was denied by the Egyptian military yet is a reminder that we have seen the market put in a sizable Egyptian premium.

The past decade has proved that houses were merely homes and not ATM machines. They were not “good as money.” Likewise, the Fed’s modern day liquid wealth creations may suffer a similar fate at a future bubbled price.

"But how do we know when irrational exuberance has unduly escalated asset values?" Alan Greenspan coined this now famous phrase in the midst of what turned out to be a fairly rationally priced stock market in late 1996. But what about now?

The age of credit expansion which led to double-digit portfolio returns is over. The age of inflation is upon us, which typically provides a headwind, not a tailwind, to securities price – both stocks and bonds.